CAG Report Exposes ₹2000 Crore Loss in Delhi Liquor Policy
The Comptroller and Auditor General (CAG) report has revealed that the 2021-22 excise policy of the AAP-led Delhi government caused a ₹2000 crore loss to the public exchequer. Delhi Chief Minister Rekha Gupta tabled the report in the Delhi Assembly on Tuesday.
The audit flagged multiple financial and procedural lapses in liquor licensing, revenue collection, and quality control. Former Deputy Chief Minister Manish Sisodia allegedly overlooked the expert panel’s recommendations, leading to flawed policy implementation.
Major Findings of the CAG Report
🔹 Liquor Vends in Unauthorized Areas: Due to a lack of approval for opening liquor shops in non-conforming municipal wards, Delhi lost ₹941.53 crore in revenue.
🔹 License Fee Loss: The excise department suffered a ₹890.15 crore loss after licensees surrendered their zones, and officials failed to re-tender them.
🔹 COVID-19 Waivers: An irregular waiver granted to liquor vendors during pandemic-related closures caused a ₹144 crore loss.
🔹 Compromised Liquor Quality: Several wholesalers skipped mandatory BIS quality tests, failing to submit reports on water purity, heavy metals, and harmful ingredients. The excise department did not enforce compliance.
🔹 Barcode Authentication Fraud: The Excise Supply Chain Information Management System (ESCIMS) recorded ₹24.23 crore in undue payments to the implementing agency. Payments were made for liquor bottles not authenticated through barcode scanning at Point of Sale (POS) counters.
Issues in the 2017-21 Excise Policy
- Licenses were issued without verifying financial solvency and wholesale price data.
- Criminal background checks were ignored, and multiple licenses were granted to related parties with common directorships.
- Liquor wholesalers had excessive control over pricing, leading to manipulated rates and revenue losses.
Flaws in the 2021-22 Excise Policy
- The Expert Committee’s suggestions were ignored, favoring private wholesalers over a government-controlled system.
- Key policy decisions were made without cabinet and Lieutenant Governor approvals.
- Retail licenses were restricted to 22 entities, allowing them to dominate the market.
The report also criticized the Excise Intelligence Bureau (EIB) for failing to curb liquor smuggling. Weak enforcement allowed illegal country liquor trade to thrive, with 65% of all seizures involving country liquor.
With these findings, the Delhi government faces serious allegations of financial mismanagement and policy failures in its excise sector.
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